Hormel Foods Corporation (HRL)
Quantitative Summary
DeterministicHRL trades at 27.3x earnings, roughly in line with its sector average of 32.6x. Financial health is average: Piotroski 5/9, Altman Z 3.3. DCF fair value of $13 implies 39% downside based on model assumptions.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of Hormel Foods Corporation reveal a capital allocation challenge where the return on invested capital of 4.9% falls below the weighted average cost of capital at 6.3%, resulting in a negative spread that erodes shareholder value over time. Despite this efficiency drag, earnings per share are supported by leverage rather than operational intensity; the DuPont decomposition shows equity multipliers driving a 1.69x load to achieve a modest 6.0% ROE from thin 4.0% net margins and sub-unity asset turnover of 0.90x. While profitability factors register positively at 0.222, indicating robust margin quality relative to peers, the overall financial health is tempered by a Piotroski F-Score of 5/9 and an Altman Z-Score of 3.4, suggesting moderate distress risk without clear signs of earnings manipulation given the negative Beneish M-Score of -2.56.
Valuation metrics present a significant disconnect between current market pricing and intrinsic value models. The stock trades at 23.4x forward earnings, substantially below the sector average of 34.2x, yet discounted cash flow analysis implies an upside of -26.6% relative to a fair value estimate of $17. This discrepancy stems from the market's expectation of merely 1.6% free cash flow growth over the next decade, which aligns with recent revenue expansion but fails to account for potential margin accretion or buyback support. Consequently, while the price-to-earnings multiple appears compressed compared to defensive peers, the DCF framework suggests the current share price may already reflect a pessimistic view of long-term cash generation capabilities.
Risk-adjusted performance indicators further complicate the investment thesis through negative factor exposures. The stock has generated an annual Fama-French alpha of -14.42%, indicating underperformance relative to its risk factors, while value and momentum signals remain neutral at 0.049 and absent respectively due to flat insider flow over the last quarter. Although profitability characteristics are robust, the combination of negative capital efficiency, low implied growth rates, and persistent alpha drag suggests that any future appreciation would require a material shift in either multiple expansion or fundamental cash conversion dynamics not currently priced into the model.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 2% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 6% | 7.2% | 9.2% |
|---|---|---|---|
| 2% | $14 | $10 | $6 |
| 3% | $19 | $13 | $7 |
| 4% | $29 | $17 | $9 |
Center = base case. Green = >10% upside, Red = >10% downside vs $23.35.
Pre-computed DCF: WACC=7.2%, terminal growth 3%. Fair value $13 (-38.9%). Not investment advice.
Valuation Context
Currently trading 17% below its 5-year average P/E of 28.1x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedHormel Foods Corporation is currently trading at $21.08, presenting a snapshot within the consumer defensive sector that warrants observation of its relative positioning against moving averages to gauge trend direction. Without specific average data points in this dataset, the immediate analysis focuses on how current pricing interacts with historical cost bases to define short-term trajectory. The absence of explicit Moving Average values prevents a definitive statement on whether the price is technically above or below key support levels at this precise moment, leaving the broader trend context incomplete based solely on these figures. Regarding momentum indicators, there are no RSI readings provided in the supplied data to quantify current buying or selling pressure. Consequently, it remains impossible to determine if short-term velocity suggests an overbought condition where prices may be extended, or an oversold state indicating potential stabilization. The technical picture derived strictly from these inputs highlights a neutral stance regarding immediate momentum shifts and trend alignment, as critical quantitative thresholds required for such assessments are missing. This synthesis indicates that while the stock resides in a defensive sector often associated with stability, the specific technical parameters necessary to confirm active bullish or bearish patterns are not visible here. Investors must rely on additional data points outside this summary to fully evaluate whether current price action aligns with established moving averages or exhibits distinct momentum characteristics before forming any conclusions about future price movement.
Quant Health Deep Dive
Profitability & Value Creation
⚠️ Dividend consumes >80% of FCF — sustainability risk.
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-04-13 | $0.2930 | 0.0% |
| 2026-01-12 | $0.2930 | +1.0% |
| 2025-10-14 | $0.2900 | 0.0% |
| 2025-07-14 | $0.2900 | 0.0% |
| 2025-04-14 | $0.2900 | 0.0% |
| 2025-01-13 | $0.2900 | +2.5% |
| 2024-10-15 | $0.2830 | 0.0% |
| 2024-07-15 | $0.2830 | 0.0% |
| 2024-04-12 | $0.2830 | 0.0% |
| 2024-01-12 | $0.2830 | +2.9% |
| 2023-10-13 | $0.2750 | 0.0% |
| 2023-07-14 | $0.2750 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like NOBL or SPYD, the fund manager is mechanically forced to buy or sell HRL shares regardless of Hormel Foods Corporation's individual fundamentals. We estimate $1.2B of passive capital is structurally linked to HRL through 8 tracked ETFs. Index rebalances and ETF creation/redemption cycles can create noticeable volume spikes unrelated to company news.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in Hormel Foods Corporation to visualize passive redemption contagion across ETFs and collateral stocks.
If Hormel Foods Corporation (HRL) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies Walmart Inc. (WMT) as the most exposed collateral stock, sharing 1 ETFs with HRL. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 27 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
HRL Ownership Dynamics
Passive funds hold 1 in every 10 HRL shares, reducing daily market volatility.
Hormel Foods Corporation (HRL) exerts measurable gravity on the passive index market, currently representing 1.5% of the ProShares S&P 500 Dividend Aristocrats ETF (NOBL) and 1.0% of the SPYD (SPYD). Across 27 tracked ETFs, approximately 56M shares (10.1% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest HRL Exposure
Float lock-up computed from 27 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
HRL Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for Hormel Foods Corporation over the past year sits near $23.86 (14% of 252-day volume). The current price of $23.35 sits 2.1% below the POC — suggesting potential mean-reversion upside if institutional demand reasserts at this level. The highly concentrated volume profile (14% at POC) indicates strong consensus on fair value — institutional participants have repeatedly transacted near this price.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
HRL Capital Efficiency
How efficiently does Hormel Foods Corporation convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
Hormel Foods Corporation converts 53% of its EBITDA into free cash flow, a healthy conversion rate indicating efficient capital management — the business generates substantial cash after reinvestment. However, the ROIC-WACC spread is negative (-2.3%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-13 | 606 | $20.18 | $12,229.08 |
| 2026-05-06 | 1,702 | $20.93 | $35,622.86 |
| 2026-04-30 | 5,212 | $20.86 | $108,722.32 |
| 2026-04-13 | 7,490 | $20.87 | $156,316.3 |
| 2026-04-10 | 115,627 | $21.13 | $2.4M |
| 2026-04-01 | 44 | $22.65 | $996.6 |
| 2026-03-23 | 12 | $22.14 | $265.68 |
| 2026-03-20 | 1,490 | $22.37 | $33,331.3 |
| 2026-02-25 | 22,978 | $25.80 | $592,832.4 |
| 2026-02-24 | 10,000 | $25.16 | $251,600 |
| 2026-02-23 | 100 | $24.99 | $2,499 |
| 2026-02-20 | 4,371 | $24.55 | $107,308.05 |
| 2026-02-10 | 1,022 | $24.41 | $24,947.02 |
| 2026-02-05 | 44,029 | $25.30 | $1.1M |
| 2026-02-04 | 68,418 | $24.62 | $1.7M |
| 2026-02-02 | 99 | $24.61 | $2,436.39 |
| 2026-01-20 | 150 | $24.22 | $3,633 |
| 2026-01-16 | 2,373 | $24.72 | $58,660.56 |
| 2026-01-15 | 19,514 | $24.49 | $477,897.86 |
| 2025-12-30 | 7,972 | $24.17 | $192,683.24 |
| 2025-11-24 | 499 | $22.69 | $11,322.31 |
| 2025-11-12 | 16 | $22.51 | $360.16 |
| 2025-11-04 | 450 | $21.48 | $9,666 |
| 2025-10-24 | 1,069 | $23.77 | $25,410.13 |
| 2025-10-10 | 791 | $23.77 | $18,802.07 |
| 2025-10-09 | 48 | $23.89 | $1,146.72 |
| 2025-10-07 | 5 | $24.31 | $121.55 |
| 2025-10-02 | 366 | $24.80 | $9,076.8 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| GIS | 0.508 | 0.503 | Moderate |
| CAG | 0.505 | 0.525 | Moderate |
| MDLZ | 0.472 | 0.553 | Moderate |
| KHC | 0.466 | 0.514 | Moderate |
| CHD | 0.466 | 0.493 | Moderate |
| COO | 0.447 | 0.293 | Moderate |
| TSN | 0.446 | 0.424 | Moderate |
| CPB | 0.445 | 0.432 | Moderate |
| MKC | 0.444 | 0.402 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare HRL to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.